Chainlink oracles to bolster AML measures for Coinfirm's DeFi solution

London-based Coinfirm will now utilize Chainlink's market-leading oracle service to provide anti-money laundering tools for DeFi projects, it said in a release Wednesday.

The firm will use Chainlink's oracle network to bring their AMLT Oracle, an AML solution for DeFi, to the rapidly expanding smart contract and the DeFi economy.

Chainlink has seen unprecedented demand for its oracles in 2020, coinciding with the growth of the broader DeFi market.

Using oracles allows Coinfirm to make compliance data and services available to dApps in a highly available and tamperproof manner.

Coinfirm's AML solution consists of a risk score for 270+ compliance indicator checks, blacklisted blockchain address checks, high-risk transaction pattern warnings, and more across the widest coverage on the market, the release noted.

"The next stage involves using Chainlink's secure and reliable oracle network to make our AML solution available throughout DeFi, enhancing the ability for traditional financial players to adopt DeFi technologies."

An existing DeFi dApp adding in a small feature where a user can pay a compliance oracle to relay its data on whether or not an address has been blacklisted prior to sending it funds.

"It's not hard to envision a scenario where a DEX or decentralized lending dApp uses a Chainlink oracle to bring an AML risk report on-chain to decide if an address is blacklisted before executing a transaction."

Decentralization purists may question: Why bring institutional AML and compliance to the world of DeFi anyway?

For Confirm, the growth of the DeFi market increases the need to address compliance.